In late March, the Russian market has left one of the few Western low-cost airlines is a British airline EasyJet. The decision was taken due to falling passenger numbers, the difficult economic situation in Russia, as well as the difficulties with obtaining visas.
The EasyJet departure was not a surprise – in recent months due to the devaluation of the ruble and General deterioration of the economic situation in Russia, many Western airlines has decided to leave the Russian market (Cathay Pacific, Thai Airways, Air Berlin) or to reduce the number of flights (Lufthansa, Czech Airlines, El Al and others).
But the story with the low-cost airline is perceived in Russia is particularly acute, given its magnitude and necessity of air transport for remote regions.
This problem is especially important the more a country is tied economically, culturally and politically to Moscow. People from the provinces is vital to have access to the center – but air transport for a number of reasons this access they can not provide.
Russian service Bi-bi-si summarized the main issues related to the sector development of affordable air transportation in Russia.
Why EasyJet stopped flying to Russia?
Intention to leave the Russian market, the carrier said in September last year. The main reason indicated a significant and sustained reduction in the demand for flights between Moscow and London.
The demand for international transportation in the past year fell not only in this area, but in General: according to the Federal air transport Agency, the reduction in the number of passengers carried amounted to nearly 19% (of 1.74 million in February this year against 2,15 million in February 2015).
Because more than two-fold devaluation of the ruble, the Russians have less to fly abroad. In addition, higher prices on international lines to 6-20% and led the withdrawal from the market of airline “Transaero”, which was calculated by the online search engine tickets Aviasales.ru.
Since the low-cost airlines focus on the segment that suffered the most from devaluation, budget carriers took the brunt from the monetary shock.
In the case of EasyJet played a role and visa restrictions: the British wishing to obtain a visa to Russia, you are now required to personally visit the visa application centre in London.
Who of low-cost carriers have left?
International low cost carriers, formally meet the criteria of low-cost airlines, there are only Hungarian WizzAir.
The Irish company Ryanair, which had planned to begin flights to Russia and did not.
But on domestic market a domestic player, the airline “Victory”, a part of Aeroflot group (controlled by the Russian government).
Starting operations in December 2014, of Victory carried in a year more than three million passengers, which experts call the largest figure for any aspiring Russian airlines.
The airline, the route network includes more than 30 destinations and is constantly expanding, entered on the basis of 2015 among the ten largest Russian carriers.
“Victory” – the only Russian loukoster?
To date, Yes. The first attempt to run in the Russian sky discounter was taken in 2006, when private owners of Alliance Air Union founded the company Sky Express. All the years of its operation it generated losses, and did not exceed the investment stage. In 2011, the Federal air transport Agency revoked her certificate.
The second attempt was the company “Avianova” that existed in 2009-2011. She was also unable to overcome the loss and the scandal went away, leaving behind debts of 1.5 billion rubles.
The third attempt was the company “Dobrolet”, created in 2014, Aeroflot and instantly placed under Western sanctions because of flights to annexed Crimea. The successor of “Dobrolet” became “Victory”, it had received two aircraft (the fleet of the company consists of 12 new Boeing 737-800 NG).
The output of “Victory” the Russian market has forced classic airlines to reduce fares. In particular, the company “UTair” announced the launch of tariff plan “light”, designed for passengers traveling without Luggage, did the same thing and S7 airlines. To changes in pricing, the industry is pushing and the decrease in the purchasing power of Russians in connection with the crisis.
Gone from the Russian market Western airlines say they are ready to return at the first available opportunity and hope that the economic situation in the country eventually changes to more favorable. So, on the resumption of flights to Russia from mid-may has already said the American Delta.
Image copyrightRIA Novosti
Image caption”Victory” like a real low-cost airline saves on everything – including the “sleeves”. And yet, in experts ‘ opinion, lives up to its name
Why others did not, but “Victory” was released?
The success included in the “Aeroflot” of a loukoster is confirmed not only by good statistics of passenger flow, but also financial indicators. After the first year of operation the company entered the small profit of 37 million rubles, although initially to become self-supporting was planned by 2018.
“It most likely is still talking about operating profits without an investment component – the investments that were made in the beginning”, – said the chief editor of the portal Avia.ru Roman Gusarov.
But this is a big success, he said, because the former Russian low-cost airlines was not operating profit. The reason for this success, in his opinion, is an effective business strategy.
In addition, not so long ago changes were made to the Air code, which allowed airlines to sell so-called non-refundable tickets. Changes in legislation in recent years has actively supported the management of the parent company – Aeroflot.
The very “Victory” explains the success of well-functioning business processes: the airline removed some unused equipment from their ships, making it easier for each of them at 1.5 tons, intensively operates, saves on staff and uses co-developed with the Boeing Corporation technology taxiing on one engine, which allows to save fuel.
Why Russians fly a little?
The frequency of air mobility of Russians in 2013 was 0.4% (these data were cited in interview Bi-bi-si ex-Minister of transport Igor Levitin). In the USA this indicator was at the level of 2.0.
According to experts of the State Institute of civil aviation, domestic trunk lines, the prices for flights were 39% higher than the price of similar tickets in the United States.
At the same time part of experts, indicates that the main reason for the low availability – not expensive air fares and low salaries.
“If we look at other countries, we can see that the price of the European low-cost airlines comparable to the prices of Russian carriers on comparable distances”, – says the chief editor of “air Transport review” Alexey Sinitsky.
Roman Gusarov believes that the real reason why Russians fly a little in other: at the level of economic development of the country – if the economy will grow, we will grow and air travel.
Meanwhile, people from neighbouring regions are simply no need to travel: they do not associate any personal or business contacts. All of the flights tied to Moscow and the entire Russian economy.
Will appear in Russia new low-cost airlines?
“What is it low cost? This element of the developed economy where a large number of economically mobile population and where opportunities drop passengers from other modes of transport”, – says Alexei Sinitsky of “air Transport review”.
“And we have in addition, rail transportation is subsidized. The government said: this is why we have no low-cost airlines? All decent countries have, and we don’t. And at the same time subsidizing of railway transportation,” he said.
“In a falling market to start a business is illogical, – adds Roman Gusarov. – Better to do it on growing. New Russian carriers on the Russian market will not be exact. So far we have falling demand in the international market, the surge of Western low-cost airlines. We have payment capacity of the population decreases”.
However, the lack of new low-cost projects in the market does not mean that ordinary Russian airlines, driven by need, not will to impose themselves partly the functionality of the discounters and in every possible way to save on flights. They will push not only the desire to attract customers, but also the desire to generate more profits and not follow the sad example of “Transaero”.
